Globe Telecom Inc. reported a strategic 24% decrease in capital expenditures (capex) for the first nine months of 2024, amounting to PHP 41.0 billion. This marks a significant shift from the same period in 2023, aligning with Globe’s strategy to optimize capital utilization and achieve positive free cash flow by 2025.
Of this expenditure, 91% was directed towards bolstering data services to provide uninterrupted connectivity, a priority that has become more essential as Filipinos increasingly rely on digital solutions. The cash capex to revenue ratio fell to 33% from 45% last year, underscoring Globe’s focused investment in sustainable infrastructure.
Globe President and CEO Ernest L. Cu highlighted the significance of this approach, noting, “Our shift towards optimizing existing network investments allows us to sustain quality service while being prudent with our capital deployment.”
The company strategically moved from opportunistic capacity expansion to maximizing the performance of existing infrastructure. This shift led to a decline in purchase orders, which represented just 53% of cash capex during the period, aligning with the goal of positive free cash flow.
Network Expansion Amidst Leaner Spending
By September 2024, Globe expanded its network by building 684 new cell sites and upgrading 2,723 mobile sites with LTE technology. It also rolled out 55,076 fiber-to-the-home (FTTH) lines. Despite the reduced capex, these expansions underscore Globe’s commitment to enhancing connectivity while using existing resources efficiently.
The company’s 5G network also grew with 378 new 5G sites, bringing the total number of connected towns to 106. In the National Capital Region, 5G coverage reached 98.51%, while key cities in Visayas and Mindanao saw coverage levels of 94.91%.
“Even with a strategic reduction in capex, we have maintained a strong push for network quality,” Cu said.
Tower Sale Boosts Liquidity
On the financial front, Globe completed a significant portion of its tower sale and leaseback deal with Frontier Towers, closing the transfer of 1,037 sites for PHP 13.17 billion on July 23, 2024. By October 28, Globe transferred 25 more towers to Unity for PHP 300 million, cumulatively generating PHP 85.5 billion from 6,653 out of 7,506 planned towers.
Response to Typhoon Kristine
During the aftermath of Typhoon Kristine, Globe faced outages across 21 provinces in Southern Luzon and Visayas, impacting less than 13% of sites in Southern Luzon and 7% in Visayas. Restoration efforts prioritized vital services, leading to full recovery in seven provinces by October 25.
Globe’s community initiatives included free call and data packages, and emergency “Libreng Tawag” and “Libreng WiFi” stations in severely affected areas like Cebu City.
Price Updates and Data Center Growth
As of October 15, 2024, Globe revised its GFiber pricing, with plans starting at PHP 1,499 for 300 Mbps speeds. The company also reported progress on its STT Fairview data center, set to complete structurally by the end of 2024 and begin operations by 2025. This, alongside the ongoing STT Cavite 2 project, will expand Globe’s data center IT capacity to 52 MW by 2026.
Pushing Fiber Connectivity Nationwide
Further demonstrating its commitment to high-speed internet, Globe upgraded 450 cities and towns with fiber-optic technology, spanning at least 60 provinces. This move supports sustainability and positions Globe as a leader in energy-efficient digital infrastructure.
Cu concluded, “With our eyes on future growth, we aim to bridge digital gaps, empower communities, and reinforce our infrastructure to support the Philippines’ digital transformation.”
